Distributed Energy Resources

Salt River Project Using Inflation Reduction Act to Build and Own Solar Plant

Arizona public power utility Salt River Project (SRP) is building a solar power project that will take advantage of recent changes in federal law that allows public power utilities to use tax benefits that were previously out of reach.

SRP’s board of directors recently approved the second phase of the 55-megawatt (MW) Copper Crossing Energy and Research Center in Florence, Ariz.

The utility-scale solar project is the first the utility is developing and will own and operate itself.

Historically, SRP has contracted for generation from renewable resources through power purchase agreements with developers that have access to federal tax credits for renewable energy projects.

The federal Inflation Reduction Act passed in August extended and expanded various energy tax incentives and gave public power utilities direct access to those credits by allowing allows public power utilities to receive direct federal incentive payments for renewable projects.

SRP said the change will give it greater ability to develop, operate and advance more renewable resources and potentially reduce costs for customers.

The first phase of the Copper Crossing project will add two natural gas-fired turbines with a total output of less than 100 MW, which SRP’s board approved in September. A third proposed phase for small-scale, long-duration energy storage system is expected to go to the utility’s board for approval in 2023.

SRP has not yet completed the design of the new solar portion of the Copper Crossing site. Engineering, material procurement and construction activities for the solar facility are expected to take approximately 24 months. The solar project is sited on land SRP owns next to its Abel substation adjacent to an existing 20-MW solar plant.

With this development and other recent awards, SRP is contracted for over 2,000 MW of our goal to add 2,025 MW of new utility-scale solar energy by 2025, SRP noted.